The County of Monterey, Calif., Civil Grand Jury logo. (Monterey County via Bay City News)

MONTEREY COUNTY — Monterey County collected more than $70 million in marijuana taxes but spent just $93,000 for youth drug education — the top priority set by residents — according to a civil grand jury report.

Some of the largest expenditures the grand jury noted were as much as $12 million for Covid-19 services and recovery, and up to $8 million in investments in the Laguna Seca Raceway, which was recently leased by a private entity.

Monterey County supervisors spent more than $70 million from taxing cannabis cultivation and sales since it began in 2018, a civil grand jury said in a report May 9. 

In the same period, $93,000 was spent on youth drug education and prevention, or about one-tenth of 1% of the total. County residents said in a 2018 community survey that drug education was their top priority for the money’s use.

A county spokesperson said the Board of Supervisors will consider a draft response by their staff before making any statement on the grand jury report.

Future allocations are likely to be small because the legal cannabis industry is in decline, the grand jury said.

Tax revenue has fallen dramatically since fiscal 2020-21, declining from about $20 million that year to a projected $3 million this fiscal year. That will leave only about $100,000 available annually for community services if market conditions hold, the grand jury said.

It said illicit sales have increased and law enforcement is important if the legal market is to be stabilized.

Supervisors have taken a series of actions including loosening restrictions on growers and retailers, lowering taxes and creating payment plans for delinquent marijuana dealers so they could stay in business. Another $2 million is due this fiscal year in deferred tax payments.

At its peak the county’s cannabis program had a full-time staff of 28, the grand jury said. With the closure or bankruptcy of more than 50 cannabis businesses, the reduced staff of 14-15 employees is struggling to keep up with the workload, which involves everything from permit processing to inspections of the remaining 50 licensed businesses in the unincorporated area.

Other major expenditures from the Cannabis Tax Assignment Fund include $3.5 million for women’s health services, $2 million to $3 million in projects related to the Pajaro River, and $2.5 million for radios for the sheriff’s office.

Another $2.6 million was dedicated to fund deficits for Lake Nacimiento and Lake San Antonio and $1.8 million was spent on the Gonzales community center and library. Jailhouse addiction services were allocated $900,000.

The grand jury recommended that the county’s director of public health should identify projects related to youth drug counseling and prevention and make priority budget requests to the Board of Supervisors by Sept. 30. 

The grand jury also called for an internal audit of the program and having the program director present annual strategic plans to supervisors. 

The report recommended keeping current tax rates in place for at least two years and following up on recommendations made by a consulting firm that included trying to make program expenditures more efficient. 

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